Friday, March 25, 2011

25 March 2011

 Moneystream very divergent.  Doesn't necessarily matter until the index starts to go with it, but it is a data point to be aware of.  Need fundamentals (less liquidity) to change and a lower high on the indexes before bears should get excited and bulls should worry.

SPY failed to close gap from March 9th today.  It needs to get to 132.39 in order to do so.
This had a nice follow-through today for the bulls.  As I've pointed out since the market bottomed last week, the TSV and my short-term indicator were very low, and a bounce was to be expected.  The bounce has come.  Now, we watch to see how strong it is internally.  The fact that this index had a lower high than previous and a lower low than previous shows internal market weakness - we do not know how high it will go here, but there is no denying that it is time it should head up.  However, using this index, I prefer (better confidence) to buy when the low is a higher low - opposite for shorting.

I cannot say this enough:  just because there is internal market weakness does not mean the indexes will be weak or not make new highs.  In order to take advantage of this info, one must trade according to strength in individual stocks.  Buy strong in long cycles, short weak in short cycles.  Get out when the cycle changes direction.
I'm not going to brag too much about this one because it is still only a percent or so increase after 20% of destruction since the high last year.

I do do quite well with my FOREX predictions, but no, I'm not rich in money terms.  Check historical posts.  Euro still looks weak like I commented on last week.  I was a little early.
 Medium term indicators both at 50%.
Hold long short term actually declined today showing some behind the scenes weakness.  I updated this around 1300 EDT today and this was up. After close, it ended up being down about 2% for the day.

Have a great weekend.  I'll be doing taxes and doing my annual 2010 review of trade successes and failures.  Sounds terribly fun.  I already know I should have held SVM (WYNN too) longer - looks weak now though, but it will be fine over the next five years.

"To buy when others are despondently selling and sell when others are greedily buying requires the greatest fortitude and pays the greatest reward."
-- Sir John Templeton

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